A123 Systems of Waltham has signed an agreement with Wanxiang Group of China that could lead to as much as $450 million in investment.

A123 CEO David Vieau says it’s a non-binding memorandum of understanding, but calls it a significant step in the process. Vieau calls the investment critical, saying it could help the company compete on a global scale.

A123 has been searching for strategic alternatives, since the company had to replace some faulty batteries made at its plant in Michigan.

Another local battery maker, Boston-Power, has announced an agreement to supply electric vehicle batteries for Beijing Automotive Industry.